The budget is your friend.
The budget is your friend.
The budget is your friend.
This is what I say to clients who are getting control of their money. So many people seem to think the budget is a horrible thing. They huff and sigh whenever we do budgets in class, and moan and groan when I bring up the subject in coaching sessions. Dave Ramsey, one of my money mentors, describes 2 financial personality types: The Free Spirit, and The Nerd. For the nerd, a budget is automatically fun. For the free spirit, it is often torture.
I have been a free spirit for most of my life. Until recently for me a budget meant: strictness, living on bread and water, denying all pleasure. Just. No. Fun. Growing up, my parents were strict budgeters, and while they did spend money on themselves for fun, that was done quietly, without a lot of fanfare. Because I didn't see them doing a lot of giving or fun with their money, I interpreted that as suffering. I vowed that I would have fun with money as an adult. I would always say "yes"!
And I did! I said "yes" a lot! I have always used my money to bring pleasure to myself and others, and as a result have been able to do incredibly generous giving and build a business doing work I love. Unfortunately, I often didn't know where to stop, and often had my lifestyle expand beyond my wage! I didn't know how to say "no", either to my wants, or to the wants of others. And so my budget often showed expenses higher than income. I was continually playing catch up with myself, which was incredibly stressful.
Now I'm all about balance. The balance between "yes" and "no". The balance between wants and needs. Through regular budgeting, I am now debt free, with an extra cushion in savings. I have the balance that my budget brings me. I feel an incredible peace of mind, as I know my needs are amply provided for, and my savings for my wants are growing steadily. My hope is that your budget can be an empowering "balancing" tool for you too!
Here are some tips to help you enjoy your budget, for a change!
1. Give first.
Giving to others stimulates endorphins, deepens our gratitude for what we have, and creates goodwill with others. Giving is an important spiritual practice for me, and so I always put my tithing and charitable giving first in my budget. This ensures I always feel abundant, and connected to what is meaningful in my life, no matter what else is going on in my budget. My money mentor Toni Stone often reminds us that giving causes getting, because that's the way things work.. And I have found that blessings, regular income, and even unexpected income, seem to show up when I am giving.
2. Plan for pleasure.
Put what you love in your budget! If you love gourmet food, put a trip to Trader Joe's in your budget. If you love new clothes, give clothing a line item. Just because you are working on getting out of debt or saving an emergency fund doesn't mean you can't have joy! And you might find contentment doesn't come from what you buy. I budgeted for dance classes while I was getting out of debt, and loved every one! But I also found contentment with a lot of other things too: beautiful walks in nature in my mountain town, laughing with my kids, a home-cooked meal after a productive day at work. And I found pleasure in seeing progress on my goals in my budget. Pleasure comes in a lot of forms, and yes, you deserve it.
3. Keep the Vision
Remember why you started a budget in the first place? To be free of crippling debt? To buy a home? To freely travel to exotic locations? Keep that vision in place while doing the daily number crunching. You might keep a vision board by your desk, with beautiful pictures of the lifestyle you are working toward. When I was in my 20s another money mentor Carol Keene inspired me to make "dream jars" with my goals collaged on them. I used that technique to save up and purchase a $1000 guitar, which I have used in my music therapy business for 18 years. You can also make these savings goals line items in your budget. It is really fun to see those funds grow, and keeps you reminded of the vision of your wonderful life!
4. Use your most fun tool.
Pick the most enjoyable way to do your budget. Some people love the look and feel of paper budgets, some like intricate spreadsheets & graphs, and others like an app on the go! Here are a few tools I recommend:
cash flow planning form~This is Dave Ramsey's basic budget I share with my beginning clients & students to help you get started. Good: It has great categories already set up for you to plug your numbers into, and recommended percentages for each. Bad: No automatic downloads from your bank so you have to add up your bills & expenses by hand.
Mint~This popular budgeting software offers a wide range of budget categories and investment/wealth building data. Good: The bank downloads are free from most large banks. Bad: Doesn't work with my local credit union! Many friends recommend this one, and like how it links to their investments as well as bank.
YNAB(You Need a Budget)~This program is highly educational, and provides blog-style posts on everything from getting out of debt to assigning a job for every dollar. Good: For $50 a year you can access all the educational info and budget templates, as well as their plan to get out of the paycheck cycle by "aging" your money and paying bills a month in advance. Bad: Don't know enough about it to know a bad side.
everydollar~my favorite, this is Dave Ramsey's free budgeting software for all computers, and Apple iphones. Good: It is colorful, very user friendly for even free spirits! and includes info on your progress on the Dave Ramsey's Baby Steps of getting out of debt and building wealth. I pay the extra $99 a year to have daily transactions downloaded from my credit union. Bad: no android app yet.
Ultimately, a budget is simply a way for you to have your money go where YOU want it to go. It helps you be conscious of how you are spending your energy. Have fun budgeting, and please let us know what works for you!